United States District Court, E.D. California
ORDER DENYING DEFENDANT HARMAN MANAGEMENT
CORPORATION'S MOTION TO STAY PROCEEDINGS (DOC. NO.
matter comes before the court on defendant Harman Management
Corporation's motion to stay proceedings in this action.
A hearing on the motion was held on July 6, 2017. Attorney
Bruce Boehm appeared on behalf of defendant Harman Management
Corporation (“HMC”), and attorney Adam Bowser
appeared on behalf of defendant 3Seventy, Inc.
(“3Seventy”). Attorney Sergei Lemberg appeared on
behalf of plaintiff Cory Larson. The court has considered the
parties' briefs and oral arguments. For the reasons
stated below, the court will deny the motion to stay.
to plaintiff's first amended complaint, defendants HMC
and 3Seventy set out on a telemarketing campaign in 2012 to
send coupons to consumers for restaurant food items via
automated text messages. (Doc. No. 22 ¶ 19.) In response
to one A&W Restaurant promotional offer, plaintiff texted
the word “BURGER” to an SMS short code licensed
to and operated by defendants. (Id. ¶¶ 21,
23.) After initially responding to plaintiff's text
message, defendants allegedly stored plaintiff's
telephone number and thereafter sent multiple unprompted and
uninvited automated text messages related to other A&W
Restaurant food items. (Id. ¶¶ 23-25.)
Plaintiff received at least two such messages-on November 16,
2014, and on June 1, 2015- without prior express written
consent, and continued to receive such messages through
February 2016. (Id. ¶ 28.)
action, plaintiff alleges that defendants violated the
Telephone Consumer Protection Act (“TCPA”), in
part by using an automatic telephone dialing system
(“ATDS”) to send the uninvited text messages.
Specifically, plaintiff alleges that defendants' system
“has the capacity to store or produce telephone numbers
to be called, using a random or sequential number
generator.” (Id. ¶¶ 37-41.)
Alternatively, plaintiff also alleges that “[i]n the
unlikely event that Defendant's system does not already
have the capacity to generate random or sequential numbers,
that capacity can be trivially added.” (Id.
¶ 42.) Finally, plaintiff alleges specific illustrative
lines of computer code that could be added to defendants'
system to generate random and sequential numbers. (See
Id. ¶¶ 43-48.)
The Telephone Consumer Protection Act and the ACA
TCPA makes it unlawful for any person “to make any call
. . . using any automatic telephone dialing system” to
certain types of telephones without the called party's
prior express consent. 47 U.S.C. § 227(b)(1)(A)(iii).
The term “automatic telephone dialing system” is
defined as “equipment which has the capacity-(A) to
store or produce telephone numbers to be called, using a
random or sequential number generator; and (B) to dial such
numbers.” 47 U.S.C. § 227(a)(1). In 2015, the
Federal Communications Commission (“FCC”) adopted
rules and regulations concerning the defining features of an
ATDS. See In re Rules & Regulations Implementing
the Tel. Consumer Prot. Act of 1991, 30 FCC Rcd. 7961 (2015)
(effective July 10, 2015). Therein, the FCC took the position
that the term “capacity” in the TCPA refers to
not only a system's “present ability” to dial
random or sequential numbers, but also a system's
potential ability to do so. Id. at 7974. Thus, even
equipment that presently lacks software necessary to enable
sequential or random dialing-but might later be programmed to
do so-could constitute an ATDS. Id.
distinction between present and potential ability is at issue
in ACA International v. Federal Communications
Commission, a case currently pending before the D.C.
Circuit Court of Appeals. Appellants in that case contend
that the FCC's definition of an ATDS is unlawful.
(See Doc. No. 66-1, Ex. A at 21-39.) Specifically,
they argue the FCC's definition of the term
“capacity” is erroneously broad and must be
limited to a system's present abilities only. (See
Id. at 22.) All briefing in that case has concluded, and
the court conducted oral argument in October 2016.
See Oral Argument, ACA Int'l v. Federal
Commc'ns Comm'n, No. 15-1211 (D.C. Cir. Oct. 19,
2016), Doc. No. 1641668. To date, however, no order in that
case has issued.
Defendant HMC's Motion to Stay
8, 2017, defendant HMC filed the instant motion to stay
proceedings in this case, pending the outcome in ACA
International, arguing that resolution of the issues in
that case will directly affect plaintiff's claims here.
(See Doc. No. 65 at 8.) On June 22, 2017, plaintiff
Larson filed his opposition. (Doc. No. 67.) That same day,
defendant 3Seventy filed its response, indicating its
non-opposition to the motion for a stay and raising several
unrelated concerns. (Doc. No. 68.) On June 29, 2017,
defendant HMC filed its reply. (Doc. No. 70.)
power to stay proceedings is incidental to the power inherent
in every court to control the disposition of the causes on
its docket with economy of time and effort for itself, for
counsel, and for litigants.” Landis v. N. Am.
Co., 299 U.S. 248, 254 (1936); accord Stone v.
I.N.S., 514 U.S. 386, 411 (1995) (“[W]e have long
recognized that courts have inherent power to stay
proceedings and ‘to control the disposition of the
causes on its docket with economy of time and effort for
itself, for counsel, and for litigants.'” (Breyer,
J., dissenting) (quoting Landis, 299 U.S. at 254)).
Deciding whether to grant a stay pending the outcome of other
proceedings “calls for the exercise of judgment, which
must weigh competing interests and maintain an even
balance.” Landis, 299 U.S. at 254-55. The
party seeking such a stay must “make out a clear case
of hardship or inequity in being required to go forward, if
there is even a fair possibility that the stay for which he
prays will work damage to some one [sic] else.”
Id. at 255. In considering whether to grant a stay,
this court must weigh several factors, including “
the possible damage which may result from the granting of a
stay,  the hardship or inequity which a party may suffer
in being required to go forward, and  the orderly course
of justice measured in terms of the simplifying or
complicating of issues, proof, and questions of law which
could be expected to result from a stay.” CMAX,
Inc. v. Hall, 300 F.2d 265, 268 (9th Cir. 1962) (citing
Landis, 299 U.S. at 254-55). A stay may be granted
regardless of whether the separate proceedings are
“judicial, administrative, or arbitral in character,
and does not require that the issues in such proceedings are
necessarily controlling of the action before the
court.” Leyva v. Certified Grocers of Cal.,
Ltd., 593 F.2d 857, 864 (9th Cir. 1979).
court begins its analysis, as the Supreme Court did in
Landis, by inquiring whether there is “a fair
possibility that [a] stay . . . will work damage” to
the non-moving party. Landis, 299 U.S. at 255. Here,
the court agrees with defendant HMC that a short stay in this
action will likely result in little damage, if any, ...